Not all large-cap blend style ETFs and mutual funds are created the same. The number of holdings varies widely (from 18 to 992), which creates drastically different investment implications and ratings. The best ETFs and mutual funds allocate more value to attractive-or-better-rated stocks than the worst, which allocate too much value to neutral-or-worse-rated stocks.

Investors seeking exposure to the large-cap blend style should buy one of the attractive-or-better rated ETFs or mutual funds from the tables below.

I assess ETFs and mutual funds based on the quality of their holdings, first and foremost, because holdings determine the performance of the fund, not just the costs or the past performance of the fund. My predictive ratings are based on (1) the aggregated stocks ratings of the holdings and (2) the all-in expenses of each ETF and mutual fund. Costs matter because they can handicap performance of a fund, but the quality of holdings is paramount because no matter how cheap the fund, the performance will be bad if the holdings are bad.

Investors need to tread carefully when considering large-cap blend ETFs and mutual funds, as only one ETF and 68 mutual funds in the large-cap blend style allocate enough value to attractive-or-better-rated stocks to earn an attractive rating.

Micrososft (MSFT) is one of my favorite stocks held by large-cap blend ETFs and mutual funds and earns my very attractive rating. Microsoft’s return on invested capital (ROIC) of 71% is particularly impressive. Only 10 companies in the entire S&P 500 have an ROIC of 70% or greater. This high ROIC has been largely driven by a 15% CAGR in after-tax cash flow (NOPAT) since 1998. Despite this impressive growth, MSFT is valued at only ~$28/share, giving it a price to economic book value ratioof 0.5. Such a low valuation implies the market is expecting a permanent decline of 50% in Microsoft’sNOPAT. This prediction is awfully pessimistic for a company that has consistently been growing profits for over a decade.

Bank of America (BAC) is one of my least favorite stocks held by large-cap blend ETFs and mutual funds and earns my very dangerous rating. BAC has not fared well since 2008, and its NOPAT took a major dive in 2011, declining by 309%. The company still faces a $1 billion lawsuit from the federal government for mortgage fraud.

The current market valuation of ~$11.50/share should concern investors because it predicts the company will grow its revenues 10% compounded annually for 9 years while also raising its ROIC from -2% to 7%. Clearly, the market is pricing in an optimistic future for BAC. Betting on the company doing much better seems like too much risk for too little reward.

Review my full list of ratings and rankings along with reports on all 33 ETFs and 944 mutual funds in the large-cap blend style.

Sam McBride contributed to this report. David Trainer owns MSFT. David Trainer and Sam McBride receive no compensation to write about any specific stock, sector or theme.